Conforming to the MPEG-4 AVC/H.264 video coding standard, this technology can operate on a personal computer without the need for special hardware and it can encode the data in near real time, meaning that the encoding takes around as long as the time of the actual recording. This promises to make software development much easier for content developers, given that the existing encoding procedures can take anywhere from 10-100 times as long as the recording.

The new technology is based on Toshiba's two-pass VBR (variable bit rate) encoding technology for the processing of high-resolution video on the existing generation of DVDs, which use red lasers. Modifying the algorithm for HD DVD, Toshiba has devised an encoding procedure that first automatically checks the video and then compresses and encodes the data scene by scene.

Toshiba plans to start licensing the technology to production studios in Japan later this month and to studios in the U.S. before the end of the year.